The Strategist

BofA names companies that provide top returns for S&P 500 participants

01/23/2024 - 10:01

According to analysts at Bank of America, the "Magnificent Seven" technology companies—American Apple Inc., Microsoft Corp., Meta, Inc., Alphabet Inc., and Nvidia Corp.—as well as Tesla, comprise the majority of the growth in profits of Standard & Poor's 500 companies in the fourth quarter of 2023.
The bank forecasts that last quarter's profits of index components decreased in the absence of those six companies. The analysts also noted a drop in Tesla's profit from October to December.

Last year, the "Magnificent Seven" contributed 62% of the S&P 500's 26% annual gain.

The Financial Times reports that the price of Big Tech (technology companies) shares increased by 105% on average in 2023. The publication points out that a greater emphasis on generative artificial intelligence (AI) has improved their appeal to investors.

The market will also be closely monitoring who is more successful at monetizing AI throughout this reporting season.

Elon Musk, Tesla’s CEO, stated earlier in January that he was ready to grow the AI division of the company with just 25% of the voting shares.



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